Union Pacific Railroad v. Caballo Coal Co.
2011 WY 24
| Wyo. | 2011Background
- UP sought indemnification from CCC for $400,000 settlement and related attorney fees after employee Roy Riecke was injured on CCC property while employed by UP.
- Riecke fell November 22, 2004 inspecting a locomotive on CCC Industry Tracks; injury allegedly arising from coal-dust-covered ballast.
- Indemnity agreement (Dec. 10, 2001) required CCC to indemnify UP for losses to the extent they resulted from CCC's negligence or wrongful act by its officers, employees, or agents.
- CCC contended UP had not shown CCC’s negligence or duty; district court granted CCC summary judgment on UP’s indemnity claim.
- CCC counterclaimed for its attorney fees; district court purportedly granted UP summary judgment on that counterclaim sua sponte, and not on a filed motion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Indemnity trigger and CCC's duty | UP: CCC’s negligence is a condition precedent to indemnification. | CCC: No duty to Riecke; no liability under contract. | UP failed to prove CCC’s negligence; indemnity denied. |
| Reasonableness of settlement | UP: Settlement reasonable; seeks indemnification for settlement costs. | CCC: Disputed; not reached due to duty issue. | Moot because indemnity failure on duty issue; |
| Attorney fees indemnification (CCC's counterclaim) | CCC: UP must indemnify for defense costs under the same provision. | UP: No affirmative duty to indemnify CCC for its own attorney fees here. | Reversed and remanded; district court violated Rule 56 by sua sponte grant without motion, notice, or opportunity to be heard. |
Key Cases Cited
- Jacobs Ranch Coal Co. v. Thunder Basin Coal Co., 191 P.3d 125 (Wyo. 2008) (interpretation of indemnity provisions; discernment of contract intent)
- National Union Fire Insurance Co. v. Studer Tractor & Equip. Co., 527 P.2d 820 (Wyo. 1974) (express indemnity parameters controlled by contract language)
- Diamond Surface, Inc. v. Cleveland, 963 P.2d 996 (Wyo. 1998) (indemnity provisions tied to specific language; not all-inclusive)
- Wyoming Johnson, Inc. v. Stag Industries, Inc., 662 P.2d 96 (Wyo. 1983) (all-inclusive indemnification provisions disfavored; acts must be attributed to indemnitor)
- Hittel v. WOTCO, Inc., 996 P.2d 673 (Wyo. 2000) (owner premises duties to independent contractor employees; pervasive control required)
- Franks v. Indep. Prod. Co., 2004 WY 97, 96 P.3d 484 (Wyo. 2004) (limited owner duty to independent contractors absent pervasive control)
- Ultra Resources, Inc. v. Hartman, 226 P.3d 889 (Wyo. 2010) (contract interpretation to ascertain parties’ intent)
- M & M Auto Outlet v. Hill Inv. Corp., 230 P.3d 1099 (Wyo. 2010) (contract interpretation; single understanding governs)
- Examination Mgmt. Servs., Inc. v. Kirschbaum, 927 P.2d 686 (Wyo. 1996) (contract interpretation standards; independence of contract language)